Construction of an effluent treatment plant at the planned Machakos leather industrial park has started, setting the stage for local and international investors to open shop at the site.
The park sitting on a 500-acre plot is designed to be a one-stop shop for leather, footwear, leather goods and related industries, including tanneries aimed at promoting growth of the leather sector.
A tannery requires huge amounts of water, power and an effluent treatment plant to operate efficiently. The common affluent plant is the biggest incentive that the government is giving investors at the park.
“The contractor for the common effluent treatment plant is already on site,” said Isaack Noor, the chief executive at the Kenya Leather Development Council (KLDC), the body overseeing the project.
He said the council has received applications from local and international firms interested in setting up factories and tanneries at the park but is yet to commence allocation of space.
Mr Noor noted other government incentives such as water, electricity and roads are already in place ahead of the official opening of the 10 bullion park at Kinanie in Machakos County.
The park set to be granted export processing zone status, is expected to revolutionise the leather value chain, creating a new market for skins and hides usually processed into blue leather and exported as raw materials.
Industrialization Secretary Adan Mohamed said the plan is to ensure that the park handles all leather processes from start to finish.
“We want to get to a point where there will be no export of semi-finished leather,” he told journalists during the launch KLDC 2017-2022 Strategic Plan.
The park which is a flagship Jubilee initiative, will see multinational investors enjoy direct, tax-free entry into Kenya.
Mr Mohamed said the ministry will be working with the National Treasury to advocate for duty free export on raw materials such as hides.
Establishment of the leather park has created apprehension from Small and Medium Enterprises who have argued that it will push them out of business.
Some leather SMEs reckon that since the park is positioned to increase production of value added products, it will be difficult for those operating outside the park to access inputs such as finished leather from tanneries.